Administrators back winding up CBL

Voluntary administrators say placing CBL Corporation into liquidation is the best option for creditors.

Creditors will meet on Friday in Auckland to vote on the liquidation resolution.

If this fails, they will be asked to support ending voluntary administration and returning control of the New Zealand insurer to directors.

“[CBL Corporation] is unable to meet its obligations to creditors,” administrators Brendon Gibson and Neale Jackson of KordaMentha say.

“The administrators consider it would be in the interests of creditors for the company to be placed in liquidation.”

The group’s financial state is so dire administrators had to arrange funding with its bankers to finance the administration. Winding up the insurance group will allow liquidators to further investigate events leading up to its various insolvency procedures.

The liquidators will seek to recover money, where possible, for the benefit of creditors.

Sydney-based Assetinsure, which CBL acquired in 2015, is not affected by its parent’s financial troubles and continues to trade as normal.

The administrators say Assetinsure operates separately, has established relationships with third-party reinsurers and is not on the list of “issues facing” CBL, as outlined in its creditors’ report.

CBL has been in voluntary administration and court-imposed interim liquidation since February.